Planning for a home renovation? Here’s how a personal loan can help!

Posted on Monday, September 25th, 2023 | By IndusInd Bank

‘Home’ is a place that will always be close to our hearts; it reflects our personality and defines us. In the circle of life, we go through a lot of changes – positive and negative, and we learn to adapt and embrace them. With time, even our homes go through a lot of changes. Some changes might require fixes, and thus, call for renovations.

Whether it requires enhanced decor, new flooring, remodelling the kitchen, or a complete makeover, home renovations require a lot of funding. Your instinct might hint at breaking your savings, but there is a better option available – a personal loan.

A personal loan can help you renovate and remodel your home easily. But what makes a personal loan an attractive option in contrast to other loans like a home loan top-up? Let us understand the features of a personal loan and how it can help you renovate your home without breaking the bank!

What is a personal loan?

A personal loan is a collateral-free loan that can be obtained with minimal documentation. These funds can be used to meet any requirement, like a vacation, wedding expenses, your child’s education, or even renovating your home. 

Home renovation project – How is a personal loan helpful?

1. Collateral-free loan

A personal loan is an unsecured loan. This means you do not have to provide any security when you apply for a personal loan. This type of loan is perfect to meet your home renovation expenses, as you need not worry about pledging your home as a security. A personal loan usually comes with flexible repayment tenures for easy repayment. 

2. Fixed interest rates

Generally, a personal loan is accompanied by a fixed rate of interest. So, you need not worry about fluctuating interest rates impacting your EMI amount every month. This feature makes personal loans an attractive financial product.  

Most banks offer competitive interest rates on a personal loan. For instance, IndusInd Bank offers personal loans at attractive rates starting from 10.49% p.a.

3. Quick disbursal of funds

When it comes to personal loans, if you match the eligibility criteria set by the bank, the personal loan gets sanctioned and disbursed quickly. However, the key to this lies in having an excellent credit score, although, you can even get a personal loan with a low CIBIL score.

The disbursal time varies between lenders. Generally, the time taken ranges between 24 and 72 hours, which is ideal in times of emergencies. You can consider availing for a personal loan from lenders like IndusInd Bank that offer instant approval and quick disbursal of funds. Thus, your home renovation project can get the required funds within a short time.

4. Minimal documentation requirement

With digitalisation, the personal loan application process has become extremely simple. Furthermore, minimal documentation is required to get a personal loan. This is quite helpful, as it speeds up the process of getting a personal loan. All you need to do is scan the documents and upload them for verification. 

IndusInd Bank’s Personal Loan application process is 100% digital and hassle-free. And before you apply for an online personal loan, you can use the personal loan EMI calculator to check the EMI you are liable to pay every month. So, you can include the amount in your monthly budget and evaluate your financial situation even before you apply for the loan. 

5. Flexible usage 

A personal loan is quite flexible, which means you can use the funds for any purpose! If you want to buy a gadget, go on a vacation or fix up your home, you can do it all with a personal loan. 

Tips to get the ideal loan amount for your home renovation 

It is crucial to plan the personal loan amount that you require to renovate your home. This ensures you do not run short of funds at the time of the renovation or do not take on an unnecessarily huge loan.

Listed below are a few tips that can help you assess the correct loan amount required for your home renovation project.

1. Check your credit score: Ensure that your credit report is free from errors. If not, rectify the errors before you apply for a personal loan. A high credit score will get you attractive personal loan interest rates.
   
   
2. Evaluate your financials: It is important to have a budget for your income and expenses. This will help you assess your current financial scenario.

It will also help you understand the amount of loan that you can take to fund your home renovation project without going overboard with your budget. 

• Assess renovation requirements: This is a crucial step when you decide to renovate your home. Make a list of all the potential expenses, inclusive of labour expenses, rental expenses of equipment, etc.

Additionally, look into areas that could be managed with DIY projects, as this can bring down your expenses. If the renovation has many projects lined up, focus on the ones that are most important at the moment and complete those first.

• Consider unexpected expenses: Unexpected expenses go hand-in-hand with home renovation projects. While creating a list of expenses, set aside about 10% of the total cost of your project as an emergency fund.

You can get an instant personal loan ranging from ₹30,000 to ₹5,00,000 via IndusInd Bank. The bank offers flexible repayment tenures of 12 to 48 months. The 100% digital application process and no physical documentation requirements make the process a stress-free one!

• Assess your repayment capacity: A general rule followed by lending institutions is that your debt-to-income ratio should be 35% or less. You can use this rule to understand how much funds you should ideally borrow to finance your renovation project.
  
  
• Short loan term: While taking a personal loan for your home renovation, try to opt for a short repayment tenure, as it reduces the interest cost. Bear in mind though, that you should select a tenure that is in sync with your repayment capacity.

Conclusion

A personal loan is an affordable and convenient financial product that can help finance your home renovation project without any hassle. However, you must select a loan amount and tenure that not just takes care of your requirement, but also is in sync with your repayment capacity.

If a home renovation plan is on your mind, apply now for an IndusInd Bank Personal Loan and give your home the desired makeover!The 100% digital application process makes it convenient to get an instant personal loan from the comfort of your home.

Disclaimer: The information provided in this article is generic in nature and for informational purposes only. It is not a substitute for specific advice in your own circumstances. Hence, you are advised to consult your financial advisor before making any financial decision. IndusInd Bank Limited (IBL) does not influence the views of the author in any way. IBL and the author shall not be responsible for any direct/indirect loss or liability incurred by the reader for taking any financial decisions based on the contents and information.